Interest rate down in September

04/10/2005 17:12

Dutch long-term interest rate, in relation to the return of the latest ten-year period government loan, averaged 3.1 percent in September 2005. That is 0.2 percent point lower than in August. By this the interest rate in September is back on the historic low level of June 2005.

The European Central Bank (ECB) did not adjust its interest rates in September 2005. The ECB last adjusted its interest rates in June 2003, raising them by 0.5 of a percent point. The lowest rate on the market is the ECB deposit rate which has been by 1.00 percent since June 2003. The main ECB interest rate, the repo rate, has been 2.00 percent since June 2003.

A major guideline for the ECB in determining its interest rate is the inflation rate in the eurozone. In the last couple of years inflation, with a dip in February 2004 of 1.6 percent and a peak of 2.5 percent in May 2004, fluctuates around 2.1 percent. According to the Statistical office of the European Union (Eurostat) the inflation in the eurozone is expected to be 2.5 percent on average in September.